Guggenheim Partners Buys Rydex

February 16, 2010

 

With its purchase of the exchange-traded fund provider Claymore Group still hot out of the oven, Guggenheim Partners announced today it is deepening its move into the ETF space, acquiring a controlling interest in Security Benefit Corp. with a $400 million investment.

Security Benefit has four major lines of business, including the asset management group Rydex, which has $22 billion in assets under management, highlighted by a $5.6 billion ETF portfolio. Rydex’s ETF lineup is led by the $1.7 billion Rydex S&P Equal Weight ETF (NYSEArca: RSP), as well as the popular CurrencyShares ETFs.

Combined with Claymore’s $2.8 billion in ETF assets, Guggenheim now controls $8.6 billion in ETFs, making it the seventh-largest ETF provider in the
U.S.

For Guggenheim, Rydex’s ETF lineup will pair well with Claymore’s offerings. Claymore’s ETFs tend to focus on satellite areas of the investment universe, such as emerging markets and thematic investments. By comparison, Rydex’s ETFs focus more at the core, highlighted by RSP and its complete lineup of “pure style” ETFs.

“Security Benefit has built an impressive portfolio of businesses that complement Guggenheim's expertise," Guggenheim Partner’s Todd Boehly said in a press release. "This transaction enables us to accelerate Security Benefit's growth given the marketplace's increasing demand for robust retirement programs and investment strategies.”

The deal comes just 2 1/2 years after the Topeka, Kan.-based Security Benefit acquired Rydex. Terms of that deal were not disclosed.

Rumors of the Guggenheim/Rydex/Claymore marriage have been circulating for nearly a year, as reported by Jim Wiandt in May 2009.

 

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